Tax Free NY – A few thoughts….

It has been almost two weeks since Governor Cuomo introduced the “Tax Free NY” program. The program is as aggressive a program that one has seen in New York in some time as it takes the term “Tax Free” to the largest extent possible.

Within the last few weeks I have gotten mixed reactions among colleagues in the legislature, residents, business owners and community leaders. As we are a parochial area, there is always from the individual view the “what’s in it for me” or “what do I get out of it” view. This is a perfectly understandable point of view. There is concern about residents moving into the area having absolutely no state income tax burden – I agree. There is grumblings in the business community that many have been paying taxes for years and are not getting any direct benefits – I agree. There are concerns about community leaders that on some state property there will be development without any revenue to the taxing municipality that needs to provide police and fire services – I agree.

That being said, one has to look at the Governor’s plan in this aspect – The “Tax Free NY” program is a effort to reflect the true competition we face when we compete with other states across our country, especially Maryland, Florida and Texas. From the Governor’s point of view, he has to look more globally that we tend to look at from local level and I respect that.

This past week I shared with the Speaker my thoughts in writing regarding the comments I have heard from many. The concerns where broken down into three major components:

Income Tax Relief – the relief of state income tax to employees new to these businesses is something we truly need to reconsider. The average Joe just does not feel this is fair and I feel we need to consider eliminating or tapering down the salary ceiling to tax relief at a level consistent with the average family vs a $200,000 Individual or $300,000 family salary which is surely not the norm here in the Capital Region.

Business Relief – if we are going to provide corporate tax relief to new businesses in these Tax Free Zones, let us also consider relief for existing businesses by eliminating some regulations such as the Scaffold Law or the Wage Notification Act, just to name a few. Those regulations are high on the list of regulations that businesses find burdensome.

Municipal Impact – For those municipalities that will be host to these new business, I believe there needs to be serious consideration to some form of municipal services agreement in place to recognize the impacts these new growth will have on the municipality. We where successful in some form accomplishing this effort in Cohoes when I was Mayor with some private entities and I believe it is right and just as the costs of public service continue to rise, particularly with pension and health care benefits. At the same time, our public safety teams do a great job.

With session coming to an end in the next three weeks I am sure something is sure to happen. I am excited about future opportunities for growth and at the same time am guarded to make sure we do not make the mistakes made years ago with the Empire Zone. The Governor is demonstrating the leadership we need to bring more economic development to New York State and I am hopeful that with some careful tweaking and effort, we can make “Tax Free NY” a reality.